This article was originally published in my personal blog Dream Weaver Diaries
As online shopping soars, the competition between etailers is at an all time high. Consumers now have an infinite number of choices on their fingertips. With the entry of Amazon, the online shopping is going to see some new trends. And with the likes of Flipkart, Myntra, the space is readying for a massive change! So who will be the ultimate winner? The one who provides an integrated shopping experience to the customer. With the increasing use of smart phones and tablet, the consumers are making purchases within their comfort and the shopping has become faster and simpler. But it has failed to capture the personalized experience that a customer gets in brick and mortar model retail store. So to generate more sales, more revenue and greater conversion, the online shopping experience shall be more integrated.
What are the factors that a customer looks into while shopping online:
- Better price – Price is one of the main factors in your purchase decision. That is why the comparison websites has increased popularity over the years. Even a single Google search returns the price comparison for you! This Diwali has seen an increase of 65% from the last season which clearly explains that customers are looking for hefty discounts.
- Return policy – A well planned and clear return policy helps the customers to take risks even if they are reluctant to buy online. Zovi offers 30 day return policy with complete cash back guarantee which prompts you to buy your shirt from Zovi and their option of “try your luck”, the surprise option is a hit among the customers. This is called the customer delight. Give them more than they are expecting.
- Faster delivery – Promise only what you can deliver. The customers expect their purchased product to reach them safely on the date of delivery and least expecting a delay. Remember customers once lost are lost forever. Studies have shown that an average consumer is willing to wait 7.2 days to receive online purchases. That means if you are not able to deliver it on time, you are going to face some critics!
- Cash on delivery – COD, hopefully we Indians start relying the internet transactions more. Make your customers aware of the benefits of online transaction and the security measures like you don’t store the card details, PCI compliance etc. Also everyone has to work together to change the ecosystem. If we can make some policy changes, it’s a win – win situation for all the eCommerce players.
- More choices and deals – Hefty discounts and surprise deals are what we are looking for. If I am getting the same quality product at a physical store, then I will buy from the comforts of physical store and not the online store. As customers we are looking for more choice. More over I am able to view all brands under one service which provides me with more options.
- Cash back guarantee – If you want to satisfy your customers, you shall take some risks. And I guess no one has taken that level like zappos. (Free shipping and free returns 365 days a year)
“If you are not 100% satisfied with your purchase, you can return your order to the warehouse for a full refund (Returns must be unworn, in the state you received them, and in the original packaging). We believe that in order to have the best possible online shopping experience, our customers should not have to pay for domestic return shipping. So if for whatever reason you’re not happy with your purchase, just go through our easy self-service return process (via My Account) to print out a free return label – your domestic shipping costs are prepaid. You can return your purchase for up to 365 days from the purchase date. If you purchase on 2/29 of a Leap Year, then you have until 2/29 the following Leap Year to return those orders. That’s four whole years! Woot!”
- Better customer service – Treat your customers as king. In return you will reap the benefits. Respond to your customers as fast as you can, because they are calling you to raise their concern. If you can’t hear their voice, how can they purchase from you? Use social media channels to respond to the queries as well as emails, which are cost effective communication channels. There should be a customer support strategy to integrate the shopping experience.
What holds your customers back?
- Fear of faulty products – Unlike the physical stores, online stores doesn’t have the comfort of touch and feel. This holds back most of the customers, but make them aware of the benefits of using an online store such as cost savings. (in terms of fuel, parking, time lost)
- Inability to touch and feel a product before purchase – The length of ownership effect i.e. the ownership of an item has been shown to increase the owner’s valuation and duration of exposure to an item will foster increased pre-ownership attachment to an item. There are many products that it is difficult to buy online without first seeing the product in person. For electronic enthusiasts, it is important to see a TV screen in person to decide which set has the best pictures. This may also be true for laptop computers or even keyboards. Certain clothes are also difficult to buy online. Many people want to feel the fabric and needs to know the fit of the clothing. Bathing suits for women is one example. Of course you could return many products if they are not what you are looking for, but often it is useful to at least see it in person, even if you end up buying it online.
- Fear of financial transactions – This is one area where the entire ecosystem has to unite. Because not a single player alone cannot make the customers understand the benefits. RBI has to make sure that financial transactions are secure and the companies are following the rules like PCI compliance. Equally the eCommerce players have to make sure that their websites are safe from phishing and spamming. As a booming sector, eCommerce has been the playground for many cyber criminals. So necessary steps has to make sure that financial transactions are secure which would increase the trust of customers as well.
eBay India’s recent study of key shopping habits of mobile commerce users in India involving over 1,000 eBay users in October 2013 has revealed that 78% shoppers prefer shopping on mobiles to get great deals on purchases and 60% shopped on mobiles to save fuel, parking charges and long queues. The survey reported that Mobile Phones, Home Appliances and Tablets were the three most purchased items online. Around 75 percent of the people surveyed admitted to shopping from home and 45 percent stated that they shopped at night. 48 percent of the people surveyed prefer credit cards as their preferred payment mode. The survey shows just the trend of modern India, but that is not the case for entire India, where the internet penetration is less than 10%.
Despite the slowdown, e-commerce in India will continue to witness a phenomenal growth the coming years and beyond. The considerable rise in the number of internet users, growing acceptability of online payments, the proliferation of internet-enabled devices and favorable demographics are the key factors driving the growth story along with an integrated shopping experience.
Post your comments below and let me know your take on this?
Amit Kumar
Hey Krishna,
While I agree with you that paying online is definitely a better thing as compared to CoD, its not actually the payment at delivery that is bad. There is a very high mentality difference between India and “the west”. Indians want to see the product before they pay for it. To win the trust of Indians, it takes years, and it takes one wrong incident to lose it. Flipkart and a lot of other ecoms have had issues where people got coconuts, stones etc, and all these contribute to the high CoD market. To make matters worse for ecom, its the cash part that is highly problematic. The return order problem is highly nominal in most cases.
Krishna Chandran
Hi Amit,
Well said. Its all about how you serve your customer. As a customer, i want the high quality product which i ordered online delivered to me in good condition. As an online store, its your duty to ensure that this high quality product is reached safely to your customer in good condition. This is where an integrated approach comes into play. Its just not about one single player, its about the entire ecosystem. Lets find out the main problem here – eCom players ships the product and the courier agencies can remove the product and ship a stone instead. Who is the culprit then. The courier agencies as well as the eCom player. The entire ecosystem has to support to make a business model success. I focused on the customers side here because ultimately they are the losers! We as a customer need something special to purchase from the online store. Those who can serve that delight is the ultimate winner too. That’s why Amazon is the number 1. Amazon prime Air wont be a reality soon. Because of the previously said ecosystem. But they are thriving innovations to customer delight which we lack i guess!
Amit Kumar
Krishna,
If you look at major ecom players, today they are moving towards such a model where they are doing deliveries themselves. Even so the cases are happening, and it’s not really the fault of eCom players anymore. It’s because India still needs to reach an economic level, where the difference between the middle class and poor is not so damn high. The delivery boy is making about 10k a month. What incentive does he have not to steal a product worth 35k, and sell it off at 25k and not return to the job? Nothing. Even better in case of CoD, collect 35k, and vanish! There have been such cases, and they generally don’t come to public.
In all other terms, I myself have friends who have misused no questions asked return policy. They have tried on clothing, and returned them after a party saying they did not like it. It’s a very tough call for the eCom players to do anything without bleeding an infinite amount of money. Amazon is capable of doing customer support for now. I doubt it will be able to sustain the model for very long in India. India needs a very different approach to customer service. There is hardly any way to find out which customer is actually worthy of customer care, and who isn’t.
Krishna Chandran
Agree to your points and Thanks for your inputs. The inputs like this will help us to understand more and widen the scope of discussion. We need companies who can think ahead of the times. There are hell lot of problems associated to eCom in India. But ultimately what i said in the post is what customers are looking for. By customers i meant those who want to buy online. How many? I don’t have the answer but definitely a big number. What needs to be done to satisfy these customers. That’s what i explained. But all these troubles and hiccups should be addressed to satisfy your customer. As a customer i don’t bother how you do the business. That’s every customers mentality. So we need to identify the problems one by one and address it to provide the best customer satisfaction. At the end, the survivor is the one who provides the maximum customer delight.
Adarsh Kedari
Hi krishna
Nice article …It’s really useful for me
What is your opinion on On-line Vegetable, fruit Shopping?
Krishna Chandran
Hi Adarsh,
Thanks for the comments.
As far as online vegetable stores are considered, i see a lot of opportunities there. For me any business if done with proper business model and a delight to serve the customers will succeed. I will talk about the opportunities here. We are in a generation where both men and women are working and time is precious. So if we are given the luxury of home delivery, we are ready to try it out. But how many people are ready. We need to validate that? Imagine a situation where a lady can shop online vegetables from her smartphone while travelling in the mumbai suburban and fresh vegetables are there in her house by the time she reaches. Thats the customer delight here.
There are online restaurants which take up online orders and deliver food. So considering all this, i see a scope for this business as well. But the profits might depend on the scale of margin that you make. For that you might need to choose the right model here. Either you can start the business by collecting the vegetables from the market or directly from the farmers. Direct from farmers has better margins and higher profit. This is actually a win win for farmers as well. Because they get better returns for what they grow.
The scale of business is huge. You might need a better research to understand the number of people who are willing to buy online. You need to talk to the farmers and make them understand the benefits. Because its about removing the middlemen and commission agents from the scene. I have seen milk cooperative societies working in my village. They collect milk directly from the farmers and source it to companies. The farmers get better rates and these societies make money through commissions.
These are all my personal thoughts and i would like to know the opinion of others as well as yours too.
Found this discussion on TRHS previously on selling vegetables online.
https://www.therodinhoods.com/forum/topics/my-thoughts-on-online-vegetable-selling-companies?id=6328457%3ATopic%3A111419&page=4#comments
Adarsh Kedari
Dear krishna,
Thank you for reply.
Yes opportunity is there because 1 family of 4 people at least consumes vegetable n fruits of 1500 Rs./month which is more than your milk. But in India milk sector is organised but vegetable n fruits not yet as it’s daily need.
About my experience:
I founded punesubji.com on 24 May n till date I have generated 1400 orders on-line with 212 register customer with average price of orders 296 Rs. I only distributed 15000 fliers in my area thr’ which I got this much response.(No online marketing nothing).
I worked on people mindset about online vegetable. yes I will say they are much positive towards it. they love to order online n happy after delivering the fresh products.
But the major problem is time of service or I can say they want delivery in very less lead time. By logistics point of view it’s difficult to design the network according to customer priority.
n second problem is the availability of delivery boy because no one ready to work in this field (as physical work is here) mostly youngsters they want to work in relax job sector.
otherwise prices problem we can overcome by bulk purchase n purchase from farmer. because intermediate chain almost increase the price by 200 or 250 %
As our portal deliver 100 products everyday that is what positive point with us but still customer don’t realise the importance of save time, save fuel, traffic, low price than retail n all products just one click away concept.
Still I am doing the market research along with people mindset towards on-line veggie shopping.
What you say any suggestion
Krishna Chandran
Thats great Adarsh. Every business needs time to prosper.
1. Manage Scale: 70-80% of the businesses fail due to over scaling. Managing scale is very important. 2. Give your customers their value for money and something unique. Whats that one thing which differentiates you from others. 3. Distribution & Trust: Try to have a bigger distribution and reach to consumers and build a trust of the brand and services that you offer. Educate them about the benefits and value adds that you provide. The key for long term is quality and delivery. Focus on micro markets and then expand your horizon.